Inter Parfums, Inc. (NASDAQ:IPAR), which is in the personal products business, and is based in United States, received a lot of attention from a substantial price movement on the NASDAQGS over the last few months, increasing to $70.41 at one point, and dropping to the lows of $63.83. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Inter Parfums’s current trading price of $63.86 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Inter Parfums’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
See our latest analysis for Inter Parfums
Is Inter Parfums still cheap?
The stock is currently trading at US$63.86 on the share market, which means it is overvalued by 23.9% compared to my intrinsic value of $51.54. Not the best news for investors looking to buy! Another thing to keep in mind is that Inter Parfums’s share price is quite stable relative to the market, as indicated by its low beta. This means that if you believe the current share price should move towards its intrinsic value over time, a low beta could suggest it is not likely to reach that level anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range again.
What does the future of Inter Parfums look like?
Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. With profit expected to grow by a double-digit 11% in the upcoming year, the short-term outlook is positive for Inter Parfums. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.
What this means for you:
Are you a shareholder? It seems like the market has well and truly priced in IPAR’s positive outlook, with shares trading above its fair value. However, this brings up another question – is now the right time to sell? If you believe IPAR should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.
Are you a potential investor? If you’ve been keeping an eye on IPAR for a while, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the positive outlook is encouraging for IPAR, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Inter Parfums. You can find everything you need to know about Inter Parfums in the latest infographic research report. If you are no longer interested in Inter Parfums, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.